Kiewit/Tulsa-Houston v. United States

37 Cont. Cas. Fed. 76,255, 25 Cl. Ct. 110, 1992 U.S. Claims LEXIS 12, 1992 WL 6974
CourtUnited States Court of Claims
DecidedJanuary 17, 1992
DocketNo. 430-88C
StatusPublished
Cited by4 cases

This text of 37 Cont. Cas. Fed. 76,255 (Kiewit/Tulsa-Houston v. United States) is published on Counsel Stack Legal Research, covering United States Court of Claims primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Kiewit/Tulsa-Houston v. United States, 37 Cont. Cas. Fed. 76,255, 25 Cl. Ct. 110, 1992 U.S. Claims LEXIS 12, 1992 WL 6974 (cc 1992).

Opinion

OPINION

LYDON, Senior Judge:

Counts I, II, III, V, VII, VIH and IX of Kiewit/Tulsa-Houston, A Joint Venture’s complaint are before the court on defendant’s Motion to Dismiss.1 The issue for decision is whether plaintiff properly certified its complaint pursuant to section 605(c)(1) of the Contract Disputes Act of 1978 (CDA), 41 U.S.C. § 601 et seq. Plaintiff opposes defendant’s Motion to Dismiss. After consideration of the parties submissions and after oral argument held December 20, 1991, the court grants defendant’s Motion to Dismiss.

[112]*112FACTS

Kiewit Industrial Co., a Nebraska corporation, and Tulsa-Houston, Inc., a Texas corporation, entered into an agreement entitled “JOINT VENTURE AGREEMENT”2 (“the Agreement”) on June 20, 1986. The parties had agreed to bid on and attempt to obtain a contract with the United States Government Department of Energy (“Owner”) for the construction of a crude oil pipeline. By the terms of the Agreement, the bid and contract would be entered into in the name of “Kiewit/TulsaHouston, A Joint Venture” (“KTH”). The Agreement provides that, “[t]his Agreement shall extend only to the submission of a joint bid and the performance of the Construction Contract, including all additions thereto and modifications thereof and shall have no other purpose.”

At all times relevant to the joint venture agreement and the dispute now before the court, Mr. Charles F. James was President of Tulsa-Houston, Inc. Mr. Gordon Nordlund served as corporate Vice President for Kiewit Industrial Co., in addition to his position as District Manager for the Power and Process District, an autonomous business unit of Kiewit Industrial Co. The joint venture for the bidding and construction of the oil pipeline is a project of the Power and Process District. As District Manager, Mr. Nordlund is the highest ranking official who devotes full time to the operation of the district and has ultimate responsibility for all aspects of the district. He reports to Mr. Keene, President and Division Manager of Kiewit Industrial Co. All District Managers report to Mr. Keene as Division Manager.

The joint venture agreement describes the structure of the joint venture. Section 3.0, Percentage of Participation, defines the interest of each party in the profits, losses and liabilities of the joint venture. Kiewit Industrial Co. is the majority party with 51%, and Tulsa-Houston, Inc. is the minority party with 49% participation. Section 4.0 of the agreement establishes that “the management of the joint venture shall be conducted pursuant to policy established by the Parties acting through a ‘Policy Committee’.” Each Party has a voice in the Policy Committee equal to its percentage of participation in the joint venture. Kiewit Industrial Co. has 51 votes. Its designated representative to the Policy Committee is Gordon Nordlund. Tulsa-Houston, Inc. has 49 votes and designated Charles F. James as its representative. According to the Agreement, the policy for the management of the joint venture is determined by majority vote of the Policy Committee. “Majority vote” is defined in the Agreement as “greater than one-half of the authorized votes.”

The powers of the Policy Committee are delineated in Section 4.5, which provides, inter alia:

4.5. The Policy Committee shall have the following powers:
a) To determine the time and place of holding its meetings and to establish procedures for conducting Committee affairs.
b) To determine and act upon the various matters, expressly or impliedly contained in other sections of this Agreement, which require decision by the Policy Committee.
c) To determine and act upon any other matters of joint interest to or requiring prompt action by, the joint venture.
f) To consider all claims and disputes of any kind between the joint venture and the Owner, subcontractors and/or third Parties and to authorize negotiation, arbitration, litigation and/or any other process for their resolution and to authorize the settlement thereof.

The Policy Committee is authorized by section 4.7 to conduct its meetings by telephonic communication between all Party [113]*113representatives where circumstances warrant.

Section 5.0 is entitled Delegation of Authority. It provides:

5.1. Kiewit Industrial Co. is hereby designated as the Managing Party, subject, however, to the superior authority and control of the Policy Committee. The Managing Party shall appoint the General Manager through whom the Managing Party shall have direct charge and supervision of all matters necessary to and connected with the performance of the Construction Contract, except as otherwise provided herein.
5.2. Authority to act for and bind the Parties in connection with all or any part of the performance of the Construction Contract may from time to time be delegated in writing by unanimous vote of all the parties to any of the Parties and/or to any individual or individuals.
5.3. Any delegation of authority to any Party or individual or individuals may be revoked by majority vote of all of the Parties; provided, however, that if the authority of the individual serving as General Manager is revoked, the Managing Party shall have the right and obligation to appoint another individual to serve in that capacity who is acceptable to the Parties hereto.
5.4. No Party shall have authority to act for or bind the other Parties except in connection with the performance and administration of the Construction Contract, and then only pursuant to authority delegated according to the provisions of this Section.

Section 12.5 of the agreement provides, “This Agreement constitutes the entire agreement between the Parties, and is subject to no other oral or written proposals, agreements or understandings whatsoever, and can only be supplemented or amended by a written document subscribed by the Parties.”

In addition to the joint venture agreement, the Parties executed a Power of Attorney on July 1, 1986, designating Gordon Nordlund of Kiewit Industrial Co. and Charles F. James of Tulsa-Houston, Inc. as their attorneys-in-fact. The document specifically enumerates nine areas in which the attorneys-in-fact are authorized to bind the Parties. The power to certify claims is not expressly included in the list. The Power of Attorney stated that it would “remain in full force and effect for a period of one year from its effective date or until revoked in writing, whichever first occurs ____”

On that same date, July 1, 1986, the Strategic Petroleum Reserve Project Office of the Department of Energy awarded Contract No. DE-AC96-86PO13055 to KTH for the construction of a 47-mile crude oil pipeline along the Gulf Coast of Texas near Houston, Texas. Under the contract, the government was required to supply the steel pipe and certain other materials to construct the pipeline. KTH was required to supply all other materials and all labor and equipment to construct the pipeline, connect it to existing oil facilities and test the pipeline. The pipeline was to be delivered December 15, 1986, for a total contract price of $23.5 million.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Bell Helicopter Textron Inc. and The Boeing Company
Armed Services Board of Contract Appeals, 2015
Orange Cove Irrigation District v. United States
28 Fed. Cl. 790 (Federal Claims, 1993)
Omni Moving & Storage of Virginia, Inc. v. United States
38 Cont. Cas. Fed. 76,481 (Federal Claims, 1993)
Kiewit/tulsa-Houston v. The United States
981 F.2d 531 (Federal Circuit, 1992)

Cite This Page — Counsel Stack

Bluebook (online)
37 Cont. Cas. Fed. 76,255, 25 Cl. Ct. 110, 1992 U.S. Claims LEXIS 12, 1992 WL 6974, Counsel Stack Legal Research, https://law.counselstack.com/opinion/kiewittulsa-houston-v-united-states-cc-1992.